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Origin stuns industry with record low price for 530MW wind farm

Origin stuns industry with record low price for 530MW wind farm

Origin Energy has set a stunning new benchmark for renewable energy off-take deals in Australia – and sounded the alarm for energy incumbents – after committing to a long-term power purchase agreement of below $60/MWh for the 530MW Stockyard Hill Wind Farm in Victoria.

Under the terms of the deal, Origin will sell Stockyard Hill Wind Farm – Australia’s largest wind development – to Chinese company and wind turbine manufacturer Goldwind for $110 million.

At the same time it has agreed to buy all of the power generated by it, and the associated Renewable Energy Certificates, for less than $60/MWh, from the commencement of operations in 2019 to 2030.

RenewEconomy understands that the strike price for the wind farm output is “well below” $60/MWh and closer to $50/MWh than $60/MWh.

As such, it sets a new benchmark for renewable energy prices in Australia, and its impact should not be underestimated. It is, after all, around half of the wholesale price and comparable to what could be bought directly from a brown and coal fired generator.